Aging and housing prices: the cases of Korea and Japan

Inho Song ()

Chapter 11 in Economic Stagnation in Japan, 2018, pp 232-260 from Edward Elgar Publishing

Abstract: Inho Song examines aging as a structural factor affecting housing prices. His long-term price model, using a model of demographic structure by age group, simulates the trend of housing prices, assuming that Korea’s housing market may experience aging similar to Japan’s over the next 20 years. Results show a downturn from 2019 (annualized growth rates of –1 to –2 percent) in real housing prices, but a rise in nominal ones (by an annual average 0.4 percent), even with effects of population aging. Results are consistent with the lifecycle hypothesis and overlapping generation models, in that aging has a direct impact on asset prices. Korea’s housing market has not yet experienced the aging effects that Japan’s has. Inflation in housing prices will be the factor deciding whether population aging effects on the housing market in Korea will be similar to those in Japan.

Keywords: Asian Studies; Development Studies; Economics and Finance (search for similar items in EconPapers)
Date: 2018
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